UPSC Prelims PYQ 2024 – Who Can Trade Corporate Bonds

✅ Correct Answer: (d) 1, 2 and 3

Explanation:

• Insurance Companies: Major institutional investors; deploy premiums into corporate bonds and Government Securities (G-Secs).
• Pension Funds: Invest in bonds for stable returns; permitted to invest in corporate bonds (generally rated ‘A’ or above) and G-Secs, subject to exposure limits.
• Retail Investors: Can invest directly (e.g., RBI Retail Direct) or indirectly (mutual funds, ETFs) in corporate bonds and G-Secs.